Hacking the economy

How to Hack the Industrial Economy: "Today, it's hugely powerful to apply hacker principles not to bits, but to industries, markets, and companies - because putting resources and activities together is cheap and getting cheaper. If that doesn't make sense, think about Wikipedia: Jimmy Wales and the Wikipedia kru took hacker principles, and applied not to phone lines or programs, but to the publishing industry itself.

The problem is that there?s a massive reversal taking place in today?s economy. While today's revolutionaries are losing sight of these principles, ironically, its industrial-era corpocracies who are learning to use them to rethink their DNA."

Be so good they can't ignore you

"Be so good they can't ignore you." - Steve Martin


Sunday links, first go

Bronte Media: Twitter and Friendster Parallels. "One eye-roller of Internet assumptions for me is that 'social networks are transient'. That they are in some way faddish, which is a complete load of shit. What does kill companies, is poor service. One of the most basic tenets of a web service is being up. Friendster's US market success was killed by its inability to stay up. Not because of MySpace's innovation, not because people change social networks like underwear and not because of any other reason. Quite simply, people couldn't login to the service and so were forced to go someplace else to express themselves."

Bronte Media: Feature vs Company. "The folks who ask this question display zero recognition that their current framework would have prevented them from investing in Google at any stage along the way. And so if you are an entrepreneur having to hear the question, you can smile at the irony."

Martin Jönsson: Sakta växer en ny communityjätte fram. "Familjeliv, Bröllopstorget, Djungeltrumman, Odla, Myblock - och så nu juvelen i kronan, sportsajten Svenska Fans. Så ser Stampens sociala medieimperium ut i och med dagens förvärv. Det är en ganska imponerande samling mötesplatser, med ett totalt besökartal på mer än 600 000. Därmed står Stampens inköpta communities snart för dubbelt så mycket trafik som modersajten gp.se."

Resumé: Spray och Passagen går ihop. "Allers Förlag och Eniro slår sina påsar ihop och bildar ett nytt bolag av webbportalerna Passagen och Spray. Samtidigt köper man in sig i den finska portalen Suomi24."



VC ER. Dot.com crash humor.


Online ads 10 % of US advertising spend

Fredrik Wass and the Swedish Jaiku community have conducted an interview with Google's Swedish Managing Director Stina Honkamaa and European Policy Manager Nicklas Lundblad.

An interesting interview, but one answer stuck the data nerd in me as just plain wrong. Stina Honkamaa claimed, if quoted correctly, that online had a 30 % share of U.S. advertising spend. (Update May 17th: Stina was misquoted. See comment from Nicklas Lundblad at bisonblog.)

After some digging I believe that the claim is (way) wrong and online's share in the U.S. is 10-15 % (depending on how the advertising market is defined). Which would be about the same as online advertising's share in Sweden (estimated to be around at 13-15 %).


- IAB says that US Internet advertising spend for 2007 was $21.2 billion.
- TNS Media believes that the total US advertising market was worth $148.99 billion in 2007 (excluding paid search online and yellow pages advertising offline)
- eMarketer says that Internet's share of total US advertising spend is about 9-10 % (expected $27.5 billion in 2008), growing to 13 % in 2011.
- ZenithOptimedia expects 9.4 % ($44.5 billion) of global advertising spend to be spent online in 2008.
- ZenithOptimedia claim that more than 15 % of advertising spend is spent online in only four countries: United Kingdom, Denmark, Norway and Sweden.


CBS acquires CNET for $1.8 billion

Corporate raider Carl Icahn's attempt to sell Yahoo! to Microsoft is not noise, but it is CBS acquisition of CNET for $1.8 billion that I find truly interesting. My relationship with CNET is no longer a daily love affair, but in the pre-blog world News.com was a daily read.

It seems like the bar for major media companies is to 'soon' have at least $1 billion of revenue from their respective Internet operations. While CNET was considered a 'business mess' by many, but $400 million of revenue is significant. And that might push 'older' CBS to reach $1 billion in online revenue ahead of 'younger' sister company Viacom.


Spotify presentation at Facebook Developer Garage

Jon Mitchell presenting Spotify at Facebook Developer Garage London May 2008. (Update 15th May: The video is, unfortunately, no longer available on YouTube.)


Kiva follow-up, month 1

A little over a month ago, I wrote about the non-profit Kiva who makes it possible for individuals to fund microloans. At the time I put my money where my mouth was and lent money to four groups of women. One month later all four groups paid their first installment.

MySpace did $210 million in Q1

MySpace is growing its advertising sales at a decent rate, but will miss News Corp's earlier revenue goal of $1 billion for the year and likely end at $900 million. That still places Fox Interactive Media/MySpace as one of the largest advertising-driven online publishers in the world including larger online than all other traditional media companies if memory serves me. A few interesting points on Fox Interactive Media's performance from News Corp's Q3 reports:

* Revenue of $210, about a third from the search deal with Google
* Performance-based grew quicker than branded (24 % vs 21 %)
* HyperTargeting, MySpace interest-based targeting system, campaigns are 20 % of all campaigns, have double the CPMs of non-targeted, the average order is 60 % larger, and the repurchase rate is 75 %
* Key pages and 'skinned' homepage attract large brand advertisers

Worth noting is that even as MySpace seems to be doing a pretty good job at attracting more brand advertisers, the amount of money from performance-based advertisers grew faster. Sometimes it feels like the discussion is about search and brand advertising, when the reality is that performance-based is about as big as brand advertising. (And search roughly the size of those two combined.) The data for HyperTargeting suggests that the approach works, but that MySpace really hasn't yet brought in new, smaller advertisers with the system.


Egmont acquires Manolo

Björn & co at Manolo have, for the second time, sold the Swedish fashion blog to a large publisher. This time it is Egmont Tidskrifter, publisher of the fashion magazine King among many other things, that has acquired Manolo from the founders and the main shareholder Sydsvenskan. From what I've seen, the price has not been disclosed. Press release.


Sometimes winning is a bad thing

With Microsoft's $47.5 billion (at $33 per share) bid for Yahoo withdrawn, at least for the time being, some people label it as a failure for Steve Ballmer. It might be a failure in the sense that the deal didn't go through, but on the other hand had the deal gone through success wasn't guaranteed. One is probably well-served to remember that most (friendly) major mergers and acquisitions don't create long-term shareholder value.

In order to create value after paying anywhere near $50 billion, a lot of things have to go right. Anyone can decide what the odds of a lot of things going right would be with the actions taken by Yahoo to discourage Microsoft's bid, Yahoo's weakening position in search, the likelihood of having to spin out either Yahoo! Mail or Hotmail and the business operational issues of both Yahoo! and MSN.


Where people find the time

Clay Shirky at the Web 2.0 Conference: Gin, Television, and Social Surplus (full, but lightly edited, transcript of the video below). Good stuff!

"Here's something four-year-olds know: A screen that ships without a mouse ships broken. Here's something four-year-olds know: Media that's targeted at you but doesn't include you may not be worth sitting still for. Those are things that make me believe that this is a one-way change. Because four year olds, the people who are soaking most deeply in the current environment, who won't have to go through the trauma that I have to go through of trying to unlearn a childhood spent watching Gilligan's Island, they just assume that media includes consuming, producing and sharing."

(via: SIME Blog)

Microsoft withdraws Yahoo offer

After three months of discussions, Microsoft has decided to withdraw its bid to acquire Yahoo. It will be interesting to see how Yahoo's shareholders react Monday, when Yahoo's share price is likely to fall back to pre-bid levels in the low $20's instead of hovering below $30. Especially as Microsoft says it raised the price in private discussions with Yahoo's board to $33 per share.